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chairman promises easy money as far as the eye can see but he also made news by speaking out against the sequester budget cutting plan saying it would damage the economy. it doesn't matter because the sequester will happen anyway on friday and we'll talk about all of that with senator tom coburn. meanwhile, president obama won't stop his sequester scare tack i can roadshow. he is calling it a self-inflicted wound on the economy and john boehner has it right telling democrats to get off their ass and pass a pill and with all due respect to my friends at cpac, they're nuts not to invite new jersey chris christie to speak at their upcoming convention. governor christie is a mainstream conservative. i am larry kudlow. the kudlow report begins right now.

bernanke and john boehner all today chief washington correspondent john harwood joins us with the details. good evening, john. >> good evening. more today of this long running effort by president obama to goed republicans to compromise with him by agreeing to additional tax increases and spending cuts to replace the sequester. today he went to new port news virginia with a lot of defense installations and made the case that defense workers would be hurt by the sequester even if all the impacts aren't felt immediately. >> the impact of this policy won't be felt over night. it will weaken our recovery, our military readiness and the basic services the american people depend on every single day.

>> he got important backup from bernanke that testified on the hill and sequester cuts would create a significant head wind to the u.s. economy and john boehner, the house speaker, fired back at president obama and said the problem isn't the house. they pass alternatives to sequester last year and the problem is the senate hasn't acted. here is the speaker. >> we have moved the bill in the house twice. we should not have to move a third bill before the senate gets off their ass and begins to do something. >> both sides have those arguments but only one side is winning this argument so far as we see in our new nbc "wall street journal" poll tonight. when you ask americans whether or not president obama is using to unify the country or in a partisan way by 48-43 he is trying to unify the country and republicans overwhelmingly the public says are doing the opposite. only 22% say they are bringing it together and 64% in a partisan fashion that does not unify the country, larry, and

this is what democrats are counting on is that the pressure over time by a public that's predisposed to blame republicans is going to make them buckle on taxes. we'll find out over the next few weeks. >> tough year for the gop. john, what's the poll say about sequester? the people want budget cuts or not? >> they don't want the sequester but they do want spending cuts. it is interesting, larry, by 52-21% americans say the sequester is a bad idea but when you ask him about replacing it, a 53% majority says either keep the sequester or replace it with something that cuts spending more deeply rather than less. so this is where republicans have the strong side of the argument is on the spending cuts side of things. >> there you go. john, many thanks. we appreciate that. president obama says sequester is the self-inflicted wound and wants to raise taxes. john boehner says get off your ass and bernanke says don't do it because it will cause economic headwinds and damaging the recovery. joining me, the distinguished

panel this evening, christy setzer and guy benson's political editor for town hall.com and will better ross. have you all heard the three options. i want you to tell me whether the sequester will go through on friday. i have a slight modifications. in one sentence should the sequester go through on friday? >> i think it will, and i think it should. >> guy benson l it go through? >> i think it will and i prefer offsetting cuts like the republicans have passed but i don't think we're going to see the democrats play ball. that's what they have been doing for the last four years on budgets and it hasn't hurt them. >> not going to get off their ass. christy, should the -- no, will the sequester, i want you to say will. will it go through? >> it will go through. i think that's a problem for democrats and republicans because it is a policy designed to be destructive. >> sh stay right where you are.

i am going to get back to the special guest in the bernanke hearing today. joining us from capitol hill, tom coburn, republican from oklahoma, senator coburn, as always, welcome back. >> thanks. good to be with you. >> you were in the bernanke hearing today, the senate banking committee, and the fed chairman said that this budget sequester, the budget sequester is going to damage the economy. slow things down. do you agree with him? >> well, i think if you calculate it as $85 billion and you took it out over a year it will slow it down. it is about 0.2% .

>> you are helping the economy to grow, certainly in the long run and maybe the short run. >> what most people don't realize, this will be the second time in since world war ii we have actually made a cut in spending at the federal government level and even though they make this 1.2 trillion, the actual government spending still going to rise every year. so the first time we did that was 1995. we sequestered about we did a recision in the house and cut about $60 billion. one of the reasons we got the balanced budget and the late economic growth in the late 1990s and 2000 is because we did that. i think this is a moderate cut. it is 2.25% of a $3.7 trillion budget. my goodness. if we can't find that, something is wrong with us. >> that's why i think bernanke over played his hand on that whole issue. if not now, when? let me ask, you have been sending letters to the white

house, giving them advice about how to conduct the sequester. can you tell us about that? >> you know, we know an awful lot about where waste is and what -- all we're doing is asking questions and you're putting out all of this stuff scaring folks when there is all of these areas that they have some flexibility in they could actually eliminate things whether i sent a letter today to jeffrey at omb outlining $356 billion that the g.o. has identified. that's $356 pinn a year in spend which a large portion is duplicative. >> did he react to that? that's a huge number. >> he is just now getting it.

>> we haven't cancelled conferences are on restricted air travel for federal government employees. all of these things they're doing they could do by teleconference, there is 100,000 ways we can cut spending in the federal government that won't have any impact on individuals in this country. >> when are they going to freeze hiring and in fact when are they going to freeze compensation? there was supposed to be a freeze which i think there was for a year or two and the reality is the senior bureaucrats got big pay increases and in the private sector a whole lot of people had to miss pay increases. when are they going to do that in the government. >> it is worse than that. what they did is bonused everybody rather than giving them a pay increase. they essentially got a pay increase through a bonus. >> most making the decision have never had line authority or operating a for profit business. they don't understand. it is not their money. they're spending somebody else's

money versus in the private sector we're very careful not to spend somebody else's money because our pay depends on it. >> i read you identified let's see, $70 billion of non-defense spending inside the defense department. defense department has been very vocal against this sequester. you have had $70 billion they don't need. >> i found $70 billion in spending inside the defense department that doesn't have a thing to do with the defense of this country. that's 70 billion, so let's say half of it, that's 35 billion right there. there is all sorts of things. we have grocery stores and pxs and commissaries. what we have done is found out that you can actually buy everything at a commissary cheaper at costco or walmart or some of the other discount places than you can at a commissary. yet we're spending hundreds of billions of dollars over the next ten years to supply

services to troops and their families at a price higher than what they can buy it off base. >> just two quick ones. do you think the sequester will go through on friday? >> yes, sir, it needs to. >> secondly, can we avoid a government shut down march 27th? >> we're not going to -- >> are we going to have a new resolution. >> we won't have the government shut down. what i expect to happen is the house next week will pass a continuing resolution to the end of the fiscal year and in that they will give some flexibility to the administration and the agencies that are under the administration to be able to move some monies around and so that we're not crying wolf on all of these hard things and we'll get rid of the things that don't matter and help the things that do. >> i tell you, i think it is going to be good for the economy. >> i do. >> i think it will be good for the stock market and the economy. senator tom coburn, keep sending the letters to the white house. >> thank you, sir, we appreciate it. >> as always, thanks to senator coburn. back to the panel live.

chris you have run a lot of businesses. it is my contention the federal government is a failed enterprise. i ask you why shouldn't they have their expenses cut substantially? >> remember, we're just talking about a reduction in the rate of increase. it is not an absolute cut. it is kind of a misnomer to call it a cut. i believe what milton friedman was fond of saying, if you put the government in charge of the desert there would be a shortage of sand, and i think it is inconceivable to me that they couldn't find enough non-critical cuts if they put their mind to it to make up for the alleged damage to the military. >> which of course they're likely to at the end of the game. let me follow up quickly if i may. do you or does big think these budget cuts as say a lower rate of spending growth, is damaging the economy? will damage the economy? >> first of all, i don't think

it can estimate the economy that precisely. you look at how many revisions they make and seasonal adjustment and everything else. plus it is not going in in the full year. it will only begin for ten months of the year so you have to take 5/6 of whatever it would have been otherwise. finally, you can make the argument forever against any reduction in spending, so if now isn't a good time, when? >> that's what annoyed me so much about what bernanke said. there is never a good time. john boehner says your friends, democrats, particularly the friends in the senate have to pass something if if they want to change this. is that going to happen? any chance that will happen? >> yes, larry, they have already put forward a plan. it is exactly the plan the american people want. it is half cuts and half spending. >> legislation, a bill they have passed with 60 votes.

>> that's the plan. i think maybe we should ask john boehner what his plan is. it is something no one wants. it is all cuts. the fact his charge that democrats don't want to plan and cut spending is completely disingenuous and in fact for every dollar that we have passed in new revenues so far we have cut $2.50. the president has a plan to cut 4 trillion dollars. >> i wish we would cut $5.50 in spending. >> the point is it needs to be balanced. what she is saying is they have acted or are acting. >> with respect to christy, she is just wrong. the house republicans are saying what is john boehner's plan. they know what it is because they passed two bills. you said no one wants the plan. we just heard john explain a majority of the public wants the plan. the democrats may have a plan somewhere in the vapors. when it comes to language on paper and having votes, they haven't done that. when it comes to a plan period,

we tonight have that from the president whatsoever on paper. specifics. he is running around the country yelling about doom and gloom and no specified plan to forestall it when it is his idea in the fist place. >> he may get in trouble if the doom and gloom don't work out as wilbur suggested they won't work out. i agree. the president is going to lose a knock or two on the polls. it was the bernanke rally today. got us about halfway back from yesterday's stock market decline. up 116 points. that's progress. good economic reports as well. we're going to get wilbur ros' thoughts and as mr. ross said, don't forget the free market capitalism is the best path to prosperity. i love that. you get a nobel prize and the show hasn't hardly started. we'll be right back. everyone's retirement dream is different; how we get there is not. we're americans. we work. we plan.

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good rebound on the street today. investors like what they heard from the easy money infinity message from the head bernanke. >> larry, a very action packed day on wall street. let's walk through the numbers. first we got strong housing and consumer confidence data that helped the market kick the day

off on a high note. dow component home depot reporting better than expected earnings thanks to an uptick in demand due to hurricane sandy and that helped lift the index. then the latest results out of the italian election showed no major winner heightening concerns italy may need a fresh round of elections and investors are fearful that the longer they go without a leader the longer it will take to solve the debt crisis. bernanke says some some ways saved the day giving wall street reassurance the federal reserve at this point will not scale back on monetary support and the markets came swinging back and the market closing the day up about 150 points on the day. >> you nailed it. thanks. hang around with us. here is deutsche bank chief u.s. economist and contributor and our friend wilbur ross. it was an easy money message,

was it not? >> it was. the story han the same. easy money for quite some time and all of this stuff about reading the minutes last week and thinking that they're going to tighten soon seems to be bernanke threw that out the window. >> he is mostly really just dovish. it is going to take a lot for him to change for him to change that. eventually he will change but not right now. >> one last time before i get to wilbur, how did you read how bernanke was reading the state of the economy? >> i thought a little on the negative side. to me, he shows the job numbers from july, he said 175,000 on average. over the last three months the average has been about 200,000 and we end itted to revise the data up. i thought it could have been more optimistic. i was surprised he mentioned gas prices crimping the consumer. that's true. they are. only a little bit. part of the higher gas might be higher demand and the fact that the economy might be improving a

bit. i thought he was too pessimistic. >> wilbur, what's the state of business right now? everybody is trying to out guess business. i know they're profitable and sitting on a pot of cash. what is business doing in your judgment? >> the top line growth really isn't there. the earnings story is more a story of profit margins, cost control, than top line growth. eventually you run out of costs that you can contain. you eventually need top line growth. very few sectors do you have much top line growth. what i think people are under estimates in terms of the impact on the economy is the whole shale gas tight oil situation. >> energy revolution. >> i think we could get a whole year's extra growth sometime in the next few years if the administration will let them go ahead. >> and everybody, i don't know if they have a pred lekz to be

pessimistic but everybody is fighting the las war about bubbles and excesses and so on. i know at some point we'll get that. i want to ask you, your view of the stock market, which until the last few days close to five year highs and really still is now, would you be an invest or in the stock market? >> i am. >> yes? you have fears about the stock market. >> sure. i have fears every day. i have fears every day. i have greater fears in the treasuries. if the ten year treasury yield went back to just the average from 2000 to 2010, it would go down 23%. that's a massive hit for treasuries. i think a few years we will look back and say there was a bubble and it was fixed income, long-term debt. >> what about bonds? do you think people talk about fixed income long-term debt? let's go to corporate bonds for a second. is it time to sell your corporate bonds and go into the stock market? >> what we have been doing and i think most other sponsors of

private equity firms are doing is getting as much long-term fixed rate money as we can right now even anticipating needs because that's how we all feel that we're heroically low rates for high yield bonds, normal corporate bonds, and certainly for treasuries and municipals. i think if people want to stay in long-term bonds, they better remember the old saying, the last one out is the rotten egg. >> joe, what's your growth estimate for this year? >> 2.25, larry, maybe to 2.5, but the first half is weak and the second half is a lot better and it is the tra jek story of better growth and i think the fed slowing or tapering qe that will get higher and i think wilbur's point is spot o they're not used to loses any monies in treasury let alone a double-digit loss. they'll take a capital loss and it will be painful.

>> do they go into stocks or just lose money? is this going to be smooth or is this going to be a bumpy ride? >> historically, '94 is a good case in point. it was very rocky, and rates were much higher than the fed had not arguably built up i think as much leverage in the system as what's happened with rates on hold for the last four years. so i would say it would be a lot worse than '94 because the fed needs to get much higher level of rates when things get better. the course of normalization, that journey will take a lot longer. >> all i will say is profits are the mother's knock of stocks. profits look okay to me. the journey will be difficult, i agree. it is way out in front of us. i would take it at day at a time. i really would. i think the correction, i think it is great time to buy the market. what do i know? going to stay with us for a while. here is a question. is a bailed out detroit making the best cars? simple question. according to the well respected car experts at consumer reports, the answer to that is no.

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welcome back to the kudlow report. it is the conservative snub making political waves tonight, the budget and tax cutting and overall fiscal reforming governor of new jersey, chris christie, also wildly popular in a blue state is not being invited to the annual conservative political action conference. with all due respect to my good friends at cpac, i think you're making a huge mistake. joining us now is steve lon began, a state director for the new jersey chapter of americans for prosperity. he also ran unsuccessfully against christie in the 2009 republican primary. our distinguished panel is still here, christie sensor, guy benson and wilbur ross.

steve, let me go to you. nobody is perfect in life. i get that. christie, spending cutter, took on the unions, wants a 10% tax cut, capped property taxes. he is for school choice. he is own pro-life on the social issues. how in the world can cpac people say he is not conservative? >> larry, i think it was the defense of snub because chris christie has never gone to cpac before ever and beat john corzine without going to cpac and never stepped foot in the door. he doesn't need cpac. i think they had a feeling he wasn't coming anyway and cut him off at the pass. >> you have people saying he is not conservative enough to speak there. i am going to talk about some very interesting reports, some of which i find very disturbing. basically don't conservatives and republicans, don't they need to enlarge and reach out and have a bigger tent? isn't that the whole issue from the last election? you have to have room for a chris christie for heaven's

sakes. >> i think republican conservatives are hopeful he would emerge ased leader. we have issues about the embrace and while we haven't had tax increases we haven't had cuts. >> can't get it through the democratic legislature. >> can't get it through and the budget just introduced today is up $1.2 billion, 4 billion in spending and still has spending increases, so it is an interesting theme because he will pull new jersey out of the cap and trade program and veto health care exchanges and turns around and tops the medicaid expansion and increases spending and so it is sort of like the push me and pull me of the conservative movement. nobody can figure which way he is going. >> i never blamed him. i mean, came at a difficult time. when you had the super storm sandy, hurricane sandy, president obama is doing his job, goes to new york, goes to new jersey. the governor of new jersey does his job. shows up with obama. i don't see how christie could have avoided that. he had campaigned very hard for

romney. he called obama divisive and demoralizing and still blaming christie essentially still doing his job even though he had to appear with obama. >> maybe you can argue he was overly complimentary but the fact of the matter is his whole brand has been we need to work together in pragmatic ways and put the people first. i think him making a political point and sort of snubbing the president during a major storm where a lot of people were at risk would have been a mistake, a, and, b, a total violation of the brand that he has built. >> and you must be thrilled about this to see republicans dumping on a guy, christie, because christie is a guy that could win new jersey. if he ran for president he could win blue states. we were talking before. republicans, not since reagan and papa bush have republicans won, i believe, california and new jersey, and i think reagan won new york twice if i am not

mistaken. it has been so long since they did that. christie is the guy that could do that. >> absolutely. the issue isn't whether cpac was inviting christie. it is that christie doesn't need the invite. it is for a lot of reasons. he needs to look to 2014 before he looks to 2016. he needs democrats and independents now and definitely doesn't need conservatives. >> that's the perceived list, do you agree with that. >> i agree with that absolutely. i think in addition to that when we look forward to 2016, he has a stronger brand than probably any other conservative in his party save for possibly marco rubio, so he really doesn't need that. >> you're saying that christie could do more for conservatives and conservative than cpac could do for christie. wilbur ross, you know him. what do you think of him? >> i was part of the group that tried to get him to rup for president last time. so i was disappointed when he didn't. i do feel he went a little too far with the president, to be thankful, to be polite is one

thing. i think he embraced him a little more than he needed to but i don't think that is a fatal sin. >> could i point out cpac didn't invite chris christie who did not raise taxes as governor. they are inviting bob mcdonnell who just passed the largest tax increase in virginia. >> very controversial. >> and also a medicaid expansion and seems to be an identity crisis at cpac. >> i don't think this medicaid -- that's a good point. i don't think this medicaid thing should be used as a litmus test. that's a state by state decision. have you sandoval is -- these are republicans, sandoval, kasich, rick snyder of michigan, rick scott of florida also endorsed and jan brewer who is a tea party person. scott was a tea party person. they're taking medicaid money. this really should be to me a

conservative -- >> what do they have in common? they have in common a lot of them are running for re-election in 2014. that point they realize the tea party brand is down. they're pragmatists at the end of the day. >> what if the house doesn't need the money? a lot of these guys are rejecting the exchanges, the obama care exchanges but they're dipping into the medicaid program. >> let me first say that the wisconsin governor scott walker who is up for re-election next year, he is also taking a look at these medicaid dollars and saying no thanks and doing it in a smart way. i think chris christie made a mistake. i am disappointed in the medicaid decision. he called it extortion and now he is voefring for the extension. i think he is in an election year and fields like he is in the process of reforming medicaid in the state and can win conservatives over. i am a fan. i think this is a mistake. the point you made is so important here and i love cpac and looking forward to going again. if you have a republican with the party's brand in the toilet

right now, with the 74% approval rating in a blue state including 80% and then 93% of republicans, you can't throw the guy out in the cold. >> i want to make another point which is disturbing. these are just reports. i cannot confirm this. reports are saying the real reason christie wasn't invited is the national rifle association, the nra. christie is for gun control. i don't know all the specifics. he said we should have a conversation. david keene is the president of the nra and he used to be for many years the head of cpac. apparently he told cpac do not invite christie because he is running against our crusade for no gun control. i don't want to get into the issue of gun control. i may not agree with christie. i don't think the weapons should be taken away. i am just saying, have a conversation. don't block it out. this is what republicans are famous for, insulating, pushing people away, instead of having a conversation. >> the problem we have, larry,

all of these people falling for medicaid demonstrates the conservative movement can't message this. >> what about the rifle association, the nra. >> in new jersey it is a huge issue. >> do they have a right to kick him out? one guy said today, and i can't confirm this, that chris christie has a very limited future in the republican party. this is all over the gun control issue. do you think it is right? >> i think there is other issues, too, beside that and i think outside of new jersey he used to be more popular than he was inside new jersey and now it is the other way around. >> what do you think about that? have you heard the same rumors, the nra kept him out of this cpac? >> there are rumors all over the place about all sorts of snubs and people not invited and i think it is just, look, there are so many problems right now in this country, the debt is $16 trillion. we have a president totally unserious about cutting spending and we are headed towards financial oblivion. >> and you have a guy, christie, who took the union's head on and

basically won and he is by the way for choice, took him on spending, took them on taxes. he took them on pensions. he took them on health care. all of which is going bankrupt in new jersey. this is the kind of tough uncompromising guy the gop needs. >> and still fails the test. >> there is no changes to union contracts at all. >> co-pays, i beg your pardon, i interviewed him and he changed co-pays and also changed the state property tax and put caps on them. >> 2% cap in state spending just went up 3% on the state level. now essential government is getting bigger and local government is squeezed. it is not a conservative model. >> he may run on that. >> he may run on that essential plan and wants more big government spending. >> you really believe christie is big government. >> yes, the state spending increased $4 billion since he has been governor and debt has gone through the roof. >> wilbur ross, last word. >> i really do not. >> all you need to do is look at

the government and the departments. government in new jersey is getting bigger and bigger and squeezing local governments to death and any mayor will tell you that. >> do you see christie as a big government republican. >> i don't. >> medicaid expansion aside. >> he is using your model? i love all of this. i think every time the republican party has a purity test where chris christie fails, i think it is good for my side. >> i think the gop needs christie. >> even paul ryan's budgets didn't cut spending. they just slowed the rate of increase. so if you want to call christie a big government spender, how about paul ryan? >> okay. >> all right. >> no argument with me. >> we'll have to see. to be continued. thank you very much. the long battle over chuck hagel's nomination for secretary of defense ended today. we have the results of the vote and much more coming up. g that he will, he was a big government republican. clients are always learning more

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drug tests as part of the application process for welfare. governor rick scott issued an executive order in 2011 but was never able to enforce it. the courts say it is an unreasonable search. in another news chuck hagel is the new defense secretary. he was officially confirmed by the senate early this evening. several republicans that voted to block him reversed their votes clearing the way for his confirmation and this should make you feel young. 72 is the new 30. scientists say life expectancies have improved so much being 72 now is similar to being 30 back in the day of hunter and gatherers. here is a story for you, a teenager that walked ten miles for a job interview has a new job and a whole lot of new admirers. he is 18 years old. on friday he had a job interview at a store ten miles from his home in indianapolis and he didn't have money for bus fare so he walked. a restaurant owner saw the kid walking and sided he could use someone with that kind of work ethic and now he is a crew

member at papa roo restaurant. good thing, the other position was full by the time he got there. >> all right. let's just talk about this kid. first of all, he has a great last name, reagan. that makes me like him off the top. wilbur, let me go to you first. this kid, this is the exact reverse of government dependency. this is personal responsibility. he is willing to walk ten miles. is he a path breaker today? >> i don't think he is as unique as you might think. i think there are plenty of young people that really want to work and are trying very hard to find jobs. i think you have some categories of people that are not, but a lot of the young people are as eager for work as they ever were. >> christie, take this point. a lot has been made of government dependency, campaign issue, still an issue, a lot of conservatives talk about it. a lot of liberals are furious it is an issue. this kid certainly is the opposite of government

dependency. he is personal responsibility and willing to walk ten miles. when you look at that, why isn't that therefore an example for a lot of other people who depend on the government and frankly should not? >> larry, look, this kid is a great example. i absolutely agree. the reason why there is so much pushback during the campaign when romney's remarks about the 47% of us who are dependent on the government came out with because the fact is that most people who get some sort of government assistance also have a strong work ethic and who also are good american citizens. we're talking about lots of people who get money from the government because they're veterans, seniors, all kinds of reasons, and the fact is if we want to demonize all of them, we're wrong. >> i just want to demonize a couple, not all of them for sure. i want to go to guy. i think food stamp eligibility has been widened too much and too many people take advantage of it. i think social security disability has been widened too much and too many people are too quick to take advantage of it.

the latest one is welfare eligibility which is being widened or lifted in terms of work requirements. when i see a story like this young kid reagan, i say to myself this is the model we want and unfortunately, i say this unfortunately too many people are willing to settle for less and go on the dole. >> this kid, mr. reagan, willing to walk ten miles to find a job, his story was nowhere to be found in the life of julia. remember the life of julia, the cartoon the obama campaign put out about the woman sheltered from cradle to grave? at no point did she have to walk ten miles. she was given things all the time by the government. there is absolutely a role for government. there is a safety net for those who absolutely need it and republicans can support that but we should cheer kids like this. >> there is a difference between a safety net which i totally favor and by the way reagan, always fafred a safety net and building that safety net such that it captures everybody.

that's the difference. sometimes you have to take things into your own hands. like this kid reagan, he did it on his own. he was his own. >> i think we're making a big deal because we see people working smart versus working hard so more people especially in our generation are using that method and that's what we see. when we see a story like this, of course it hits home. >> i hope you are right. i truly hope are you right. >> and restaurant work is working hard. >> absolutely. >> it is tough work. >> absolutely. >> seema, guy, and christy, and the most respected car analysts in the country out with the latest reports. that story is up next. ♪

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why are the best cars no longer made in the usa? consumer reports annual list of top car picks features eight japanese models and no domestic models from any of the big three, gm, ford or chrysler. we have to fix this. in fact, we are now joined by lauren fix, the car coach automotive expert, joe is here with me, and so is wilbur ross. okay. i am going to read a couple. i want you to tell me, consumer reports, you may not agree with them. honda accord, lexus, subaru, mazda, nobody from detroit in the top half. what's up?

>> i don't agree. i think there is a lot of politics involved. manufacturers want you to pick a side. is it black or white? make a stand. what is the recommendation? who is good? who is not? it is really difficult to do that. i write for aol autos as independent -- >> what am i missing? give me a for instance. >> missing for example i think the ford fusion is a phenomenal car. >> hold on. to be honest with them, they did test the ford fusion hybrid and they like it. they called it an up and coming car. actually i read this article. it is not my usual ball of wax but i read it and they did like the ford fusion. none of the other boys, buick, chrysler, ford, lincoln, chrysler, what's up with that. >> i think to compare jeep to a lexus is a little silly. they're totally different price points and purpose to the vehicle. so to say jeep is in the bottom category, within its own real category who is better than jeep? i am not sure that there is anybody. i think they paint it with too

broad a brush. if you're in the business of making lists, you have to make a change every year otherwise nobody will read the list you publish. i don't think it is too surprising they come out with something this year all japanese and maybe next year all germans. hard to imagine that no german car qualifies. >> that's an interesting point. in the article they mention that honda, they like the honda accord. the honda accord, wasn't on any of their lists last year. this year they have it on the list. what do you make of american cars? we bailed out general motors. we bailed out chrysler, i might add i own a lincoln which is made by ford and not bailed out. do you think that was the correct decision? is it being repaid by quality automobiles? >> i think so, larry. i mean, i think the quality control of these vehicles certainly has improved. the market share for some of these companies has stabilized. we know auto sales are picking up. we make in the month of february and american makers are

part of that. >> talk to me about car sales. this is a big thing. ramping up for how long. >> and also let's not forget trucks. trucks are bigger share now than cars. that's part of the story you were alluding to earlier. we are looking at cars. maybe we should include trucks. there is a lot of pent-up demand because the fleet is very old and ageing and consumers need to buy new cars and trucks. fact they're buying cars and trucks by all anecdotal information suggests the payroll tax hike and some of the other concerns we have, i think it matters and not as much as people -- >> it didn't matter when they cut it and it is a temporary rebate. this is an important story and they're getting credit, that's coming alive for the auto purchases. >> credit and cheap credit. very few cars are bought for cash. think about the ads on television. they never even say what the price of the car is. they say how much per month. the vast majority of people in this country live month to month. so all they really care about is what does it cost me per month,

not the absolute price. >> what about, though, i am down in this bottom six thing, buick, buick, chrysler, ford, i love my lincoln, but buick, chrysler, ford, and then dodge at the bottom of the list. is it to bad? >> no, it isn't actually. if you look at the product coming out of chrysler, the u connect system, the interface, just won an aol technology of the year award. it is one of the few system that is works as it is stated. have you ever used bmwi drive? i don't know you how they got into the list when there are other great cars that fit in the category including the cadillac ats that i just test drove and the rankings weren't that far behind but i think there are a lot of domestics short changed including sports cars. >> what's the best car give me your pick. >> that's the biggest question. there is no general car. as far as manufacturers, i think vw group makes some of the best cars out there right now. >> that's not from detroit. >> i know but we're built in the

u.s. and giving us jobs. >> that qualifies as u.s. >> it is giving us money in the u.s. you have chath noog a tennessee, building past sats there and i also think they overlooked on the list the jetta diesel. it is completely overlooked and a hybrid that gets better fuel economy than a lot of had i brids out there. i have a deasel and fell in love with it. i think it is fantastic. she have sigh coming out with their own diesel. >> it is very interesting. are the hybrids going to make it? are the electric battery cars going to make it? >> i think you need to have radical angz in technology to work. they're too heavy. too bulky. too limited in range. so the hybrid is a way of making an even more complicated vehicle because now you have combustion engine plus an electric one. i frankly think that better than that would not gas powered thing. >> i owned a hybrid suv and i won't name the name, but it was a disaster.

thank you. you're all great to do this. that's it for this evening's show. i am larry kudlow. i own an american car and didn't get a bailout either. we will see you tomorrow night to talk capitalism. . [ kitt ] you know what's impressive? a talking car. but i'll tell you what impresses me. a talking train. this ge locomotive can tell you exactly where it is, what it's carrying, while using less fuel. delivering whatever the world needs, when it needs it. ♪ after all, what's the point of talking if you don't have something important to say? ♪